Applovin offers to buy video game software maker in $17.5 billion deal

Gaming software company Applovin Corp on Tuesday made an offer to buy peer Unity Software Inc in a $17.54 billion all-stock deal, looking to tap into growing demand for threedimensional gaming.

Both companies make software used to design video games. Game-making software has also been expanding to new technologies such as the so-called metaverse, or immersive virtual worlds.

Unity’s software has been used to build some of the most-played games such as “Call of Duty: Mobile,” and “Pokemon Go”, while Applovin provides helps developers to grow and monetize their apps.

The enterprise value of the deal is $20 billion. Applovin will offer $58.85 for each Unity share, which represents a premium of 18 per cent to Unity’s Monday closing price.

Shares of Unity rose 7 per cent, while those of Applovin fell 14 per cent before the opening bell.

Under the proposed deal, Unity will own 55 per cent of the combined company’s outstanding shares, representing about 49 per cent of the voting rights. Reuters